Mobile Campaigns Drive Sales for Certain Categories

Microsoft Study: Products With Shorter Purchase Cycles Perform Best

SAN FRANCISCO (AdAge.com) -- An independent study commissioned by Microsoft found that mobile ads are driving sales, especially in categories that have a shorter purchase cycle. According to the survey involving 1,100 consumers, 13% said they have made online or offline purchases for movie tickets, concert tickets and other entertainment goods as a result of seeing a mobile ad.

About 12% made a package-goods purchase because of a mobile ad, and 10% bought consumer electronics and apparel. Mobile has less sway for categories such as financial services and auto, the survey showed. The findings also suggest that mobile coupons can drive store traffic: 62% of the respondents said they're more likely to shop at retailers that offer incentives.

"The brands that have reaped the greatest return on their mobile advertising investments are more likely to be those in a shorter purchase-cycle category," said Charles Johnson, general manager of Microsoft's mobile advertising business group. "This is most likely due to a trend that follows the maturation of ... emerging media channels."

Because early investments in mobile are small, brands tend to commit to shorter campaigns. The expectation is that as the channel grows, so will budgets. At that point, advertisers can "gradually sustain their mobile presence over a long enough period so as to significantly influence consumer buying behaviors in classic long purchase-cycle categories such as financial services ... and automotive," Mr. Johnson said.

Other experts say mobile's immediacy could also explain the survey's findings. "It's the path of least resistance -- if I get a coupon, I'm going to go in," said Joy Liuzzo, senior director of marketing and mobile research at InsightExpress. "The coupons offered by CPG and entertainment companies help to drive preference all the way down the purchase funnel." In contrast, automakers are building awareness and spurring dealer visits, so they're "two levels away from the bottom of the funnel," Ms. Liuzzo said.

Suspicions
David Bear, executive director of mobile and social media at Atmosphere Proximity, said automakers realize they have to be in mobile because shoppers are researching and comparison shopping on the go as they visit different dealers.

Still, the optimistic-looking data comes with a few caveats, among them the reliability of self-reported behavior and the company behind the survey. "I would be somewhat suspicious of a Microsoft-commissioned study because they have every reason to publish numbers that attract dollars," said Eric Bader, managing partner of mobile agency Brand in Hand. Still, Mr. Bader said he agreed with findings, which are not out of line with another third-party study he has reviewed.

Also worth noting is that 85% of the survey's respondents are smartphone users, who are more likely to interact with their phones because of the better user experience. Yet this group is fewer than 20% of U.S. wireless subscribers.

Still, consumers are using their phones to facilitate purchase decisions: 46% said they use their handsets to compare prices in the store. More than 43% said they use mobile search every day, including 40% who said they use their phones to search for product information and 34% who use them to look up store locations.

Entertainment and CPG may perform well simply because their wares are conducive to mobile promotions. "An entertainment offering on mobile devices bodes well for how people interact with their device, which is to look up nuggets of information or to be entertained," Mr. Bear said, noting that entertainment and CPG brands have also led mobile ad spending.

In the moment
For on-the-spot mobile calls to action, entertainment marketers also have lots of tools in static media, among them embedding short codes into movie billboards and providing tools to share promotional vehicles such as movie trailers.

CPG brands perform well because mobile puts buyers closer to the point of decision and sale, Mr. Bader noted. "People like to have a fast, convenient way to discover the product they need and the deals they want ... and being able to interact with that information on-the-go and where it's relevant -- on the way to store, at the mall, in the aisle -- is very attractive ... to consumers."

Still, the lack of case studies makes it difficult to conclude that some categories truly outperform others. "The lesson ultimately is that ... CPG, apparel and entertainment brands that create engaging campaigns that get people to care and spend time with the content can enjoy high response rates and build loyalty at rates superior to categories that people care less about or where the purchase decision requires much more information, tactile interaction and sales help," Mr. Bader said.